All sub-indices of the India’s manufacturing sector PMI moved lower during June, S&P Global said.
In some cases, this was a positive, while in others it pointed to cooling growth.
Global demand for Indian goods continued to improve in June, while manufacturing firms also faced less intense cost pressures themselves.
Concerns over demand and market conditions dampened business sentiment in June.
With total new orders and international sales increasing at softer rates, there were slower expansions in buying levels, employment and output.
Input inventories rose to a lesser degree and there was an outright contraction in post-production stocks.
Falling from 55 in May to 54.2 in June, the seasonally adjusted HSBC India manufacturing PMI pointed to the second-weakest improvement in the health of the sector since mid-2022 (ahead of March).
Growth was strong and aligned with the long-run series average. With the exception of March, rates of increase in both output and new orders were the weakest seen in four years.
Several Indian firms reported an improvement in demand conditions, but others noted subdued client appetite for their products and fierce market competition.
International demand for Indian goods continued to improve in June, but the pace of growth was modest and the weakest in 39 months amid reports of subdued sales to some European markets.
With demand growth somewhat fading, goods producers became more reluctant to lift their fees. Output charges rose to a moderate degree that was the least pronounced in three months.
Manufacturing firms in India also faced less intense cost pressures themselves, as evidenced by the slowest increase in purchasing prices since February.
Input buying growth lost momentum in June, receding to its weakest in two-and-a-half years. Hence, stocks of purchases rose at a softer pace.
With regards to finished goods inventories, the latest results highlighted an outright fall. The drop was solid, the fastest in six months and ended a two-month period of accumulation. Firms linked the drop to the better alignment of production and stocks with current demand conditions, a press release from S&P Global said.
A general absence of capacity pressures restricted recruitment activity in June. Backlogs of work were broadly unchanged and employment expanded at the weakest rate this year till now.
Concerns over demand and market conditions dampened business sentiment in June.
The proportion of firms forecasting output growth in the year ahead halved since May, with a large share of manufacturers signalling neutral expectations. The overall degree of optimism retreated to a five-month low.
Fibre2Fashion News Desk (DS)
